BackgroundAcademic self-efficacy and psychological well-being play a crucial role in the mental health of nursing students and influence whether they decide to remain in the nursing profession. AimsThis study aimed to determine the effect of laughter therapy on self-efficacy and psychological well-being in nursing students. MethodsIn this randomized controlled study, 208 nursing students were randomly assigned to an experimental (n = 102) and a control (n = 106) group. The experimental group received laughter therapy face-to-face once a week for eight weeks. No intervention was applied to the control group. In both groups, data were collected at the beginning of the study and the end of the eighth week using a Sociodemographic Questionnaire Form, the Academic Self-Efficacy Scale, and the Psychological Well-Being Scale. ResultsIn the post-study group comparisons, there was a statistically significant difference in the scores for the total Academic Self-Efficacy Scale, the external emotion management and collegiality subscales, and the total Psychological Well-Being Scale (p > 0.05). With regard to all the scale scores, no statistically significant difference was found in the groups in the pre- and post-comparisons (p > 0.05). ConclusionsIt was determined that laughter therapy increased the mean psychological well-being score in the experimental group. It was also found that after the laughter therapy, distraction and loss of interest in lectures decreased, stress and anxiety levels decreased, eating and sleeping habits were regulated, and social media use decreased. Laughter therapy can be used to increase self-efficacy and psychological well-being.